Search form

Search form

U.S. universities are facing credit risks because of lawsuits filed by victims of shootings, Moody's Investors Service says. "The lawsuits are credit negative for affected universities because they create financial and reputational risks and divert senior management's efforts away from other operating activities," Moody's says.

Related Summaries

The approval of legislation requiring higher employee and state contributions to the Employees Retirement System of Texas is being called "a significant improvement" and credit positive by Moody's Investors Service. The measure will "slow ERS' annually increasing unfunded liabilities," Moody's said.

The upcoming lapse of the Terrorism Risk Insurance Act backstop is credit negative for U.S. property/casualty insurers, a Moody's Investors Service report says. The expiration is likely to result in limited and higher-cost terrorism insurance coverage, especially in big markets, and "will likely produce significant strain on workers' compensation renewals," Moody's said.

Moody's Investor Service said Lincoln National's signing of a reinsurance treaty backing up to $4 billion of future variable annuity living benefits is "credit positive because it provides full risk transfer for the guarantees and will enhance Lincoln's risk/return." The analysis by Shachar Gonen, an assistant vice president at Moody's, said that because of price increases and the reduced risk profile of current products reinsurers should find variable annuity living benefits more attractive.

Revenue growth was eclipsed by expenses during fiscal 2012 at half of U.S. public universities, which are dealing with other fiscal challenges as well, according to Moody's Investors Service. Flagship schools are faring better than others because of their ability to attract out-of-state students, who pay higher tuition rates, Moody's said.

States and local governments face a $2 trillion shortfall in pension funding, with fiscal 2010 liabilities more than three times the amount that local governments reported, says Moody's Investors Service. "Pension liabilities are widely acknowledged to be understated," Moody's Timothy Blake says. The ratings agency is mulling changes to its treatment of pension liabilities.